What does an IR35 Contract Review entail?
We offer one of the most comprehensive IR35 / Off-Payroll review services available, which are all carried out personally by highly experienced IR35 specialists, most with HMRC compliance backgrounds and over 20 years’ experience in IR35 and employment status. Here, we provide a detailed overview of what is covered in all our IR35 review services.
- We collect and review details of your business structure and working practices from your answers to our status questionnaire.
- We review, after ensuring, that your written contract consists of the correct paperwork and that all schedules and any other document referenced, such as a Statement of Work or an appendix are present in the contract.
- We check and review any Status Determination Statement to ensure it is accurate and above all that the correct party has completed it.
- The next very important step is to establish the parties to the contract and consequently their responsibilities and risks. This is straightforward in a direct contract but where agencies or other intermediaries (such as Consultancies) are involved we need to correctly identify the “Client”.
- We consider the public sector (from April 2017) and the private sector (from April 2021) Off-Payroll rules and establish which sector the “Client” is in, which may look obvious but may not be straightforward.
- From April 2021 with the advent of the Off-Payroll rules we also need to consider and review the size and whereabouts of the “Client” in order to establish if the “Client” is exempt. For example, are they classed as wholly overseas without any presence in the UK and/or do they fall into the definition of a small company?
- We review and consider the status of any Consultancy to establish if they are in fact providing a genuine outsourced service to the end client or if they are just providing workers as an agency would. If they are providing genuine outsourced services, then they become the “Client” for deciding IR35 and if they are also small, they are exempt from the off-payroll rules. We also consider here the agency rules in case these apply if the service is not an outsourced service falling under the exemption.
- Once we have covered 1 to 7, we review all against up-to-date IR35 case law precedent, note our findings including any further questions or clarifications we need.
- We then call you to discuss our findings and agree next steps. Next steps can include negotiating on your behalf with the legal team at your agency or Client to seek amendments to the contract, seeking client confirmation of the reality of the working arrangements if necessary and in cases where the contract has not yet started and things are unclear, we wait a couple of weeks before issuing our IR35 opinion, to ensure that the reality of the working practices are accurate and reflect the contractual terms. We also provide guidance to strengthen your in-business features.
- Finally, we issue a written IR35 opinion for your records.
Yes, we will highlight any unbalanced terms such as, notice periods, bring to your attention unfair payment terms, carefully review indemnity clauses (which are in almost every contract we see and can be hard to spot by the un-trained eye), review restriction clauses, discuss the merits or otherwise of opting in or out of the agency Conduct Regulations plus commentary on anything else that may be incorrect, unfair, or plain wrong and explain to you your risks responsibilities and liabilities.
Remember a Contract Review by Bauer & Cottrell demonstrates that you have taken reasonable care over your IR35 position and protects you from penalties in the event of an HMRC IR35 investigation. Look out too for our free HMRC defence with the Contractor Guardian Plus service.
Contact a member of our team today if you need a review.